Systems and methods for implementing person-to-person money exchange

ABSTRACT

A system conducts online financial transactions between individuals or between individuals and entities such as banks, merchants and other companies. Each user establishes an online account, which is used to transfer funds to and from other online accounts. Any user may initiate a send money transaction or a request payment transaction with any other entity provided that entity has an e-mail address. The online fund transfer may include a verification of a user&#39;s information including verifying a mailing address.

RELATED APPLICATIONS

The present application is a Continuation of U.S. patent applicationSer. No. 10/961,505, now U.S. Pat. No. 7,792,720, entitled “SYSTEMS ANDMETHODS FOR IMPLEMENTING PERSON-TO-PERSON MONEY EXCHANGE,” filed on Oct.8, 2004, which is a Divisional of U.S. patent application Ser. No.09/639,014, now U.S. Pat. No. 7,031,939, entitled “SYSTEMS AND METHODSFOR IMPLEMENTING PERSON-TO-PERSON MONEY EXCHANGE,” filed on Aug. 15,2000; each of which is incorporated by reference.

BACKGROUND

The present invention relates generally to online financialtransactions, and more particularly to systems and methods for effectingperson-to-person online financial transactions.

As more and more individuals become connected to the Internet, thenumber of e-commerce transaction grows proportionately. Currently,typical e-commerce transactions require individuals to submitconfidential information such as credit card information or other bankaccount information over the Internet to affect a transfer of funds. Forexample, each time an individual purchases a product from a differentmerchant over the Internet, the individual must typically submitconfidential credit card information to the merchant to complete thepurchase transaction. The more an individual transmits such confidentialinformation over the Internet the more opportunity there is for thatinformation to be compromised.

Additionally, it is often difficult for individuals to effect monetarytransactions without ultimately having a check sent from the payor tothe payee; credit card transactions are not widely available forindividuals. For example, in the context of an auction where oneindividual wins a bid to purchase an item from another individual, thepurchaser must usually send a check to the seller. Such transactions aregenerally undesirable as postage is necessary to send the check, andprocessing of the check is required. This generally results in anundesirable increase in the amount of time and effort required tocomplete the transaction.

Accordingly, it is desirable to provide systems and methods foreffecting online financial transaction between individuals or betweenindividuals and merchants without the need for sending and cashingchecks or transmitting confidential information.

SUMMARY

The present invention provides systems and methods for effecting onlinefinancial transactions between individuals or between individuals andentities such as banks, merchants and other companies. The presentinvention is particularly useful for effecting person-to-personfinancial transactions.

According to the invention, each user accesses a fund exchange server toestablish an online account, which is used to transfer funds to and fromother entities' online accounts. An online account is generally a storedvalue account representing funds held in an account for the user at anaffiliated financial institution. Each account, whether an individualaccount or a corporate account, can have one or more sub-accountsassociated therewith. To fund an online account, funds can betransferred to an online account from, for example, a credit cardaccount, direct demand account (DDA), or other financial account or fromanother online account. To withdraw funds, money can be transferred to acredit card account or other bank account. Any user may initiate a sendmoney transaction or a request payment transaction with any other entityprovided that entity is able to receive an electronic message. Forexample, the receiving entity needs an ID or an e-mail address for ane-mail account to which an electronic message may be sent. Theelectronic message may be an e-mail message, instant message or otherelectronic message.

A user, i.e., an entity such as an individual or corporation, thatdesires to send money to another entity can do so by accessing anexisting online account associated with the user and initiating a sendmoney transaction. The user sending money (payor) enters an amount offunds to be transferred and contact information such as a user ID or ane-mail address of the recipient of the funds (payee). The payee may bean individual or other entity such as a corporation. The system sends anelectronic message to the payee, for example, using an e-mail address ifprovided, indicating that the amount of funds has been “received” on thepayee's behalf. To effect transfer of the funds, the payee must accessthe system, for example, by selecting a URL or other link provided inthe electronic message, and direct the received funds to an onlineaccount. An existing online account may be identified by the payee byproviding information such as an account number and/or other identifyinginformation such as a password. If the payee does not have an existingonline account, the payee must sign up for an account and provide creditcard information or information for a checking account or other bankaccount sufficient to effect electronic transfer of funds. Thereafter,the received funds can be directed to the newly activated onlineaccount. At any point up to the time the received funds are deposited inthe payee's online account, the payor can cancel the transaction. Anyuser may withdraw any or all of the balance in their online account(s)at any time by transferring funds to a credit card account or other bankaccount.

A request money, or request payment, transaction, e.g. sending a bill,may also be initiated by a user (e.g., individual or corporation) thatdesires to receive payment from another entity. The user enters anamount of funds owed and contact information such as an e-mail addressfor the recipient of the payment request (payor). In the case ofmultiple payors, an amount and contact information (e.g., user IDsand/or an e-mail address) is necessary for each payor. The recipient ofsuch a transaction request (payor) may be an individual or anotherentity such as a merchant corporation. The system sends a paymentrequest to the payor via an electronic message, for example via e-mailto a provided address, and the payor may respond by selecting a URL orother link provided in the electronic message. If the payor accepts thepayment request, the payor identifies an online account from which totransfer funds to the payee (initiator of the payment request). If thepayor does not have an online account established, the payor must signup for an online account and provide credit card information, orinformation for a checking account or other bank account sufficient toeffect electronic transfer of funds, to fund the online account.Thereafter, the amount of funds are transferred to the payee and thesystem sends an e-mail notification or other electronic message to thepayee indicating that the funds have been “received” on the payee'sbehalf. To complete the transaction, the payee must direct the receivedfunds to an online account, for example, by providing an online accountnumber and/or other identifying information such as a password. Thepayor may cancel the transaction at any time until the payee directs thereceived funds to an online account.

According to an aspect of the invention, a computer implemented methodof transferring funds from one online account to another is provided.The method typically comprises the step of receiving a transfer requestfrom a first user, the transfer request including an amount of funds fortransfer from a first online account associated with the first user andidentification information for a recipient of the funds, theidentification information including an e-mail address of the recipient.The method also typically includes the steps of automatically sending ane-mail notification to the recipient at the e-mail address, receiving aresponse from the recipient accepting or rejecting the transfer offunds, and transferring said amount of funds from the first account to asecond account associated with the recipient if the response indicatesacceptance.

According to another aspect of the invention a computer implementedmethod of transferring funds from one online account to another. Themethod typically comprises the steps of opening a first accountresponsive to a request from a first user to open an account, andreceiving a payment request from the first user, the payment requestincluding an amount of funds for transfer to an online accountassociated with the first user and identification information for arecipient of the payment request (payor), the identification informationincluding an e-mail address of the payor. The method also typicallyincludes the steps of automatically sending an e-mail notification tothe payor at the e-mail address, the e-mail notification including theamount of funds to be transferred to the first user, receiving a paymentresponse from the payor indicating acceptance or rejection of thepayment request, and sending a second e-mail notification to the firstuser indicating whether the payment response from the recipientindicates acceptance or rejection of the payment request. If the paymentresponse indicates acceptance, the method typically includes the stepsof receiving a transfer request from the first user indicating that thefunds be transferred to an identified online account associated with thefirst user, and transferring funds to the identified online account froma second account associated with the payor in response to the transferrequest.

According to yet another aspect of the invention, computer code executedby a computer system in a computer network is provided. The computersystem is communicably coupled to a database of user accounts, the useraccounts including values representing funds maintained by a financialinstitution on behalf of the users. The computer system executing thecode for updating the values in the user accounts. The code typicallyincludes instructions for processing a transfer request received by thecomputer system from a first user over the network, the transfer requestincluding an amount of funds for transfer from a first user accountassociated with the first user and identification information for asecond user, the identification information including an e-mail addressof the second user, and instructions for automatically sending an e-mailnotification to the second user at the e-mail address indicating thatfunds are ready for transfer to the second user. The computer code alsotypically includes instructions for processing a response received fromthe second user to determine whether the second user has accepted orrejected the transfer of funds, and instructions for updating the valuesof the first user account and a second user account associated with thesecond user to reflect that the amount of funds was transferred from thefirst user to the second user if the response indicates acceptance.

According to a further aspect of the invention, computer code executedby a computer system in a computer network is provided. The computersystem is communicably coupled to a database of user accounts, the useraccounts including values representing funds maintained by a financialinstitution on behalf of the users. The computer system executing thecode for updating the values in the user accounts. The code typicallyincludes instructions for processing a payment request received from afirst user over the network, the payment request including an amount offinds for transfer to a first user account associated with the firstuser and identification information for a second user, theidentification information including an e-mail address of the seconduser, and instructions for automatically sending an e-mail notificationto the second user at the e-mail address, the e-mail notificationincluding the amount of funds to be transferred to the first user. Thecode also typically includes instructions for processing a paymentresponse received from the second to determine whether the second userhas accepted or rejected the payment request, instructions for sending asecond e-mail notification to the first user indicating whether thepayment response from the recipient indicates acceptance or rejection ofthe payment request, and if the payment response indicates acceptance,instructions for processing a transfer request received from the firstuser to determine a user account identified by the first user, andinstructions for updating the values of the identified account and asecond user account associated with the second user to reflect that theamount of funds was transferred from the second user to the first user.

According to yet a further aspect of the invention, a computerimplemented method is provided for transferring funds between useraccounts in a computer network including two or more affiliate banks,wherein the affiliate banks conduct fund transfer settlements. Themethod typically comprises the steps of receiving a transfer request totransfer funds from a first online account associated with a first userto a second online account associated with a second user, wherein thetransfer request includes a bank identifier that identifies a first oneof the affiliate banks, and transferring funds from the first onlineaccount to the second online account after the second user has approvedthe transfer request, wherein the first affiliate bank conducts the fundtransfer settlement for the transferred funds on behalf of the firstuser.

According to still a further aspect of the invention, a computerimplemented method is provided for transferring funds between useronline accounts in a computer network. The method typically comprisesthe steps of receiving registration information from a first user forestablishing a first online account, the registration informationincluding a physical mailing address, and setting a transaction limit onthe first account to a first value. The method also typically includesthe steps of thereafter receiving a confirmation code from the firstuser, wherein the confirmation code confirms that the physical mailingaddress is a valid address, and thereafter increasing the transactionlimit on the first online account to a second value.

Reference to the remaining portions of the specification, including thedrawings and claims, will realize other features and advantages of thepresent invention. Further features and advantages of the presentinvention, as well as the structure and operation of various embodimentsof the present invention, are described in detail below with respect tothe accompanying drawings. In the drawings, like reference numbersindicate identical or functionally similar elements.

BRIEF DESCRIPTION OF THE DRAWINGS

FIG. 1 illustrates a general overview of an information retrieval andcommunication network including a fund exchange server, client devices,and remote servers according to an embodiment of the present invention;

FIG. 2 illustrates the process of conducting a send money transactionaccording to an embodiment of the present invention;

FIG. 3 illustrates an exemplary form for use during a send moneytransaction according to an embodiment of the present invention;

FIG. 4 illustrates the process of conducting a request money transactionaccording to an embodiment of the present invention;

FIG. 5 illustrates an exemplary form for use during a request moneytransaction according to an embodiment of the present invention;

FIG. 6 illustrates an exemplary form for use during a request moneytransaction involving multiple recipients according to an embodiment ofthe present invention; and

FIG. 7 illustrates an exemplary form for use with a “move money”transaction according to an embodiment of the invention.

DETAILED DESCRIPTION

FIG. 1 illustrates a general overview of an information retrieval andcommunication network 10 including a fund exchange server 20, clientdevices 30.sub.1 to 30.sub.N, and remote servers 50.sub.1 to 50.sub.Naccording to an embodiment of the present invention. In computer network10, clients 30.sub.1 to 30.sub.N are coupled through the Internet 40, orother communication network, to fund exchange server 20 and servers50.sub.1 to 50.sub.N. Only one fund exchange server 20 is shown, but itis understood that more than one fund exchange server can be used,either individually or in a distributed manner, and that other serversproviding additional functionality may also be interconnected to anycomponent shown in network 10 either directly, over a LAN or a WAN, orover the Internet.

Several elements in the system shown in FIG. 1 are conventional,well-known elements that need not be explained in detail here. Forexample, each client device 30 could be a desktop personal computer,workstation, cellular telephone, personal digital assistant (PDA),laptop, or any other device capable of interfacing directly orindirectly with the Internet. Each client 30 typically runs a browsingprogram, such as Microsoft's Internet Explorer, Netscape Navigator orthe like, or a microbrowser such as a WAP enabled browser in the case ofa cell phone, PDA or other handheld wireless devices, allowing a user ofclient 30 to browse pages and forms available to it from fund exchangeserver 20, servers 50.sub.1 to 50.sub.N or other servers over Internet40. Each client device 30 also typically includes one or more userinterface devices 32, such as a keyboard, a mouse, touchscreen, pen orthe like, for interacting with a graphical user interface (GUI) providedby the browser on a monitor screen, LCD display, etc., in conjunctionwith pages and forms provided by fund exchange server 20, servers50.sub.1 to 50.sub.N or other servers. The present invention is suitablefor use with the Internet, which refers to a specific globalInternetwork of networks. However, it should be understood that othernetworks can be used instead of the Internet, such as an intranet, anextranet, a virtual private network (VPN), a non-TCP/IP based network,any LAN or WAN or the like.

According to one embodiment as will be described in more detail below,fund exchange server 20 and any related components are operatorconfigurable using an application including computer code-run using acentral processing unit such as an Intel Pentium processor or the like.Computer code for operating and configuring fund exchange server 20 asdescribed herein is preferably stored on a hard disk, but the entireprogram code, or portions thereof, may also be stored in any othermemory device such as a ROM or RAM, or provided on any media capable ofstoring program code, such as a compact disk medium, a floppy disk, orthe like. Additionally, the entire program code, or portions thereof maybe downloaded from a software source to fund exchange server 20 over theInternet as is well known, or transmitted over any other conventionalnetwork connection as is well known, e.g., extranet, VPN, LAN, etc.,using any communication medium and protocol as are well known.Additionally, portions of the program code may be downloaded or providedto client device 30 and executed on client device 30.

In general, a user accesses and queries fund exchange server 20, servers50.sub.1 to 50.sub.N, and other servers through a client device 30 toview and download content such as news stories, advertising content,search query results including links to various websites and so on. Suchcontent can also include other media objects such as video and audioclips, URL links, graphic and text objects such as icons and hyperlinks,forms, pages and the like. Additionally, such content is typicallypresented to the user as a web page formatted according to downloadedJavaScript code and HTML code and data as is well known. In general, anyStandard Generalized Markup Language (SGML) may also be used. Users areable to communicably access fund exchange server 20, e.g., over theInternet 40, using a client device 30 and conduct transactions, openonline accounts and monitor online account activity as will be describedherein.

A user typically accesses fund exchange server 20 by selecting orentering the URL identifying the fund exchange server 20. One example ofsuch a fund exchange server 20 is located at the URLhttps://paydirect.yahoo.com. When accessed, fund exchange server 20preferably provides the user with one or more web pages includingoptions for opening online accounts, accessing existing online accounts,initiating transactions, responding to transaction requests, etc. If theuser has already established an online account they may access anaccount page by providing an account number and security informationsuch as a password and a security key. The account page preferablyincludes various status information of pending and past transactions,account balance(s), user preferences, etc., as well as options forinitiating various financial transactions. If the user does not have anestablished account, the user can select to open an account. The usercan open an account by providing information such as an e-mail address,a password, mailing address and/or other information as may benecessary.

In general, an “online account” is an online stored value accountrepresenting an amount of funds held on the users behalf at an affiliatebank or other financial institution. A database 22 is provided forstoring account information and data as is well known. To fund anaccount, the user must provide credit card information, e.g., creditcard number, expiration date, etc, sufficient to effect a transfer offunds from a credit card account to the financial institution holdingthe user's actual funded account. An ATM check card (e.g., including aVisa logo) may also be used for transfer of funds to and from a checkingaccount. ACH transfers may also be used to transfer funds to and fromthe affiliate financial institution as are well known. As shown in FIG.1, each financial institution can be represented as one of servers 50and a credit card company can be represented as another one of servers50. A connection may also be established between fund exchange server 20and credit card server 50 or with financial institution server 50 orwith an ACH network server. When a transaction has been completed,transaction information is communicated from fund exchange server 20 tothe financial institution server 50, and the user's actual account iscredited or debited accordingly. When a user desires to fund an onlineaccount or withdraw funds from an online account, the financialinstitution server handles the actual fund transfers such as credit carddebits and credits, ACH transfers and the like.

According to one embodiment, various online financial transactions maybe initiated using an established online account, including a “sendmoney” transaction, a “request money” transaction and a “move money”transaction. In a “send money” transaction, one is able to send funds toan entity such as another individual or a merchant, in a “request money”transaction, one is able to receive payment from another entity orentities, and in a “move money” transaction, one is able to transferfunds to and from a credit card account, ATM check card account,checking account, brokerage account, any other financial account, oranother online account associated with the user.

FIG. 2 illustrates process of conducting a “send money” transactionaccording to an embodiment of the present invention. In this case, theinitiator of the send money transaction is the “payor,” and therecipient of the transaction request is the “payee”. After the payor hasselected the “send money” option, at step 100 the payor is prompted toenter an amount of funds for transfer and identification information forthe recipient of the funds (payee). Identification information typicallyincludes a name and an e-mail address of the payee or other contactinformation such as a user ID for initiating an instant message (IM)session, and may also include an identity confirmation query. Forexample, in one embodiment as shown in FIG. 3, the payor is presentedwith a form 200 including an amount field 210, a name field 220, anaddress field 230, message fields 240, an identity confirmationselection button 245 and a query field 250. The payor then enters theappropriate information in the fields. In a preferred embodiment, amountfield 210 and e-mail address field 230 are required to be filled out,and the remaining fields are optional. If the payor selects to use theoptionally provided identity confirmation feature, a query must also beinput. The payee is later asked to confirm their identity by answeringthe query to the satisfaction of the payor as will be discussed in moredetail below.

After the amount and identification information has been entered andsubmitted, e.g., by selecting continue button 260, at step 110 thesystem processes the information and sends an electronic message (e.g.,e-mail notification or IM) to the recipient (payee) using the contactinformation provided by the payor. The electronic message typicallyincludes a link (e.g., URL link or other selectable link) to a web pagelocated on the fund exchange server 20. In one embodiment, theelectronic message only alerts the payee that funds are ready to betransferred to the payee, however, the electronic message can includevarying amounts of information such as the sender's name, the amount offunds ready for transfer, etc.

Upon selecting the link, a communication session is established betweenthe payee (i.e., using client device 30) and the fund exchange server20. The payee is provided with a web page or other online document thatallows the payee to accept or reject the “send money” transaction. Forexample, in one embodiment, a form is provided with various fields andselection buttons. If the identity confirmation feature was selected bythe payor, the payee is also presented with the identity confirmationquery and a field for entering a response to the query. The payee mustidentify an account into which the funds are to be transferred, e.g., byproviding an account number and password. If the payee does not have anaccount established, an account can be opened as described above. Afterall appropriate information has been entered and submitted by the payee,the system processes the received information at step 120. If the payeerejected the transaction, at step 125 the payor is notified of therejection, e.g., by an e-mail notification message or by updating thepayor's account page, and the transaction is canceled. If the payee hasaccepted the transaction, the system determines whether identityconfirmation is active for the current transaction in step 130. If theidentity confirmation feature was not selected by the payor, in step 135the funds are transferred from the payor's account to the accountidentified by the payee. If the identity confirmation feature wasselected, in step 140 the payor is notified, preferably by an electronicmessage, that the payee has responded to the identity confirmationquery. Preferably, the response is included in an electronic messagealong with a URL link to the system, however, the response can be postedto the payor's account page for review the next time the payor logs intothe system.

If the payor is satisfied with the information provided in the identityconfirmation response, the payor responds to the system with a decision.For example, the payor may select an accept button or a reject button.At step 150, the system receives and processes the payor's decision. Ifthe payor rejected the identity confirmation response, the transactionis canceled in step 155. If the payor accepted the response, in step 160the funds are transferred from the payor's account to the accountidentified by the payee. The payor can cancel the transaction at anytime until the funds are transferred to the payee's account.

FIG. 4 illustrates the process of conducting a “request money”transaction according to an embodiment of the present invention. In thiscase, the initiator of the request money transaction is the “payee,” andthe recipient of the transaction request is the “payor”. After the payeehas selected the “request money” option from the account page, at step300 the payee is prompted to enter an amount of funds for transfer andidentification information for the recipient of the payment request(payor). Identification information typically includes a name and ane-mail address of the payor or other contact information such as a userID for initiating an instant message (IM) session. For example, in oneembodiment as shown in FIG. 5, the payee is presented with a form 400including an amount field 410, a name field 420, an address field 430,message fields 440, and an invoice field 450. The payee enters theappropriate information in the fields. In a preferred embodiment, amountfield 410 and e-mail address field 430 are required to be filled out,and the remaining fields are optional.

After the amount and identification information has been entered andsubmitted, e.g., by selecting continue button 460, at step 310, thesystem processes the information and sends an electronic message (e.g.,e-mail notification or IM) to the recipient (payor) using the contactinformation provided by the payee. The electronic message typicallyincludes a link (e.g., URL link or other selectable link) to a web pagelocated on the fund exchange server 20. In one embodiment, theelectronic message only alerts the recipient that a payment request,e.g., invoice or bill, has been received, however, the electronicmessage can include varying amounts of information such as the sender'sname, the amount of funds desired to be transferred, etc.

Upon selecting the link, a communication session is established betweenthe payor (i.e., using client device 30) and the fund exchange server20. The payor is provided with a web page or other document that allowsthe payor to accept or reject the “request money” transaction. Forexample, in one embodiment, a form is provided with various fields andselection buttons. The payor must identify an account from which thefunds are to be transferred, e.g., by providing an account number andpassword. If the payor does not have an account established, an accountcan be opened and funded as described above. If the payor accepts thetransaction they are provided with the ability to select the identityconfirmation feature. If the identity confirmation feature is selected,the payor must enter a query. After all appropriate information has beenentered and submitted by the payor, the system processes the receivedinformation at step 320. If the payor rejected the transaction, in step325 the payee is notified of the rejection, e.g., by an electronicmessage or by updating the payee's account page. If the payor hasaccepted the transaction, in step 330 the system notifies the payee,e.g., by sending an electronic to the payee indicating that thetransaction has been accepted by the payor. In one embodiment, the payormay select to accept the transaction in part, in which case the payormust enter the partial payment amount. The partial payment amount isalso communicated to the payee, either in an electronic messageindicating acceptance or by posting to the payee's account page. If thepayor has selected the optional identity confirmation feature, the queryis also communicated to the payee, either in an electronic messageindicating acceptance or by posting to the payee's account page. Theelectronic message also typically includes a link to a web page locatedon the find exchange server 20.

Upon selecting the link, a communication session is established betweenthe payee (e.g., using client device 30) and the find exchange server20. The payee is provided with a web page that allows the payee todirect the “received” funds to an online account. For example, in oneembodiment, the payee is provided with an account page for an accountassociated with the payee. Alternately, or in addition, a form isprovided with various fields and selection buttons. If the identityconfirmation feature was selected by the payor, the payee is alsopresented with the identity confirmation query and a field for enteringa response to the query. The payee must identify an account into whichthe funds are to be transferred, e.g., by designating the accountassociated with the active account page, or by providing an accountnumber and password for another account associated with the payee. Ifdesired, the payee may open another account as described above.

After all appropriate information has been entered and submitted by thepayee, the system processes the received information at step 340. Thepayee may also be provided with an option to cancel the transaction atthis point. At step 350, the system determines whether identityconfirmation is active for the current transaction. If the identityconfirmation feature was not selected by the payor, in step 355 thefunds are transferred from the payor's account to the account identifiedby the payee. If the identity confirmation feature was selected, in step360 the payor is notified, preferably by an electronic message, that thepayee has responded to the identity confirmation query. Preferably, thisresponse is included in an electronic message along with a URL link tothe system, however, the response can be posted to the payor's accountpage for review the next time the payor logs in to the system.

If the payor is satisfied with the information provided in the identityconfirmation response, the payor responds to the system with a decision.For example, the payor may select an accept button or a reject button.At step 370, the system receives and processes the payor's decision. Ifthe payor rejected the identity confirmation response, the transactionis canceled in step 375. If the payor accepted the response, in step 380the funds are transferred from the payor's account to the accountidentified by the payee. The payor can cancel the transaction at anytime until the funds are transferred to the payee's account.

In one embodiment, a multiple payor bill may be submitted as part of a“request money” transaction. FIG. 6 illustrates an exemplary form 500for use during a request money transaction involving multiple recipients(payors) according to an embodiment of the present invention. Form 500preferably includes amount fields 510, name fields 520, address fields530, message fields 540, and a selection field 550 for selecting thenumber of recipients. The payee enters the appropriate information inthe fields, submits the form, and the system thereafter submitstransaction requests to each individual payor and conducts transactionprocessing individually as described above with reference to FIG. 4.

In a “move money” transaction, funds are transferred to and from anonline account. According to one embodiment, funds may be withdrawn froman online account to a credit card account, an ATM check card account,checking account or other financial account. According to anotherembodiment, funds may be transferred to an online account from a creditcard account, an ATM check card account, checking account or otherfinancial account. The financial institution server 50 effects thetransfer of the actual funds with the appropriate account server, e.g.,credit card server, ACH network server, bank server, etc. In anotherembodiment, funds may be transferred between online accounts associatedwith the user. For example, the user may have two or more separateonline accounts or one or more online sub-accounts may be tied to amaster online account. For sub-accounts, actual funds are debited orcredited to an account at the financial institution associated only withthe master account, such that when an online transaction involving asub-account is completed actual funds may, only be withdrawn from, oradded to, the master account. Funds may be moved between the masteraccount and a sub-account by the entity controlling the master account.Sub-accounts are useful for many applications, including, for example,allowing parents (controlling master account) to provide a monthlyallowance to a child (sub-account) away at college or providing alimited spending account (sub-account) for an employee in charge ofbuying office supplies for a company (controlling master account).

To effect transfer between online accounts and between an online accountand a credit card account, ATM check card account, checking account orother financial account, the user is preferably provided with a formwith fields for entering the amount desired to be transferred, theaccount into which funds are to be transferred and the account fromwhich funds are to be transferred. FIG. 7 illustrates an exemplary formfor use with a “move money” transaction according to an embodiment ofthe invention. As shown, form 600 preferably includes an amount field610, an account field 620 from which funds are to be transferred and asecond account field 630 into which funds are to be transferred. Otherfields may be presented for other necessary information such aspasswords, PIN numbers, expiration dates, routing numbers, etc. If auser has previously entered account information, the user is preferablyable to select that account without having to re-enter the information.When filled out, the user submits the form and the system processes theinformation and moves the funds accordingly. For onlineaccount-to-online account moves, the database 22 is updated, and fortransfers to and from online accounts, financial institution server 50is provided with the appropriate information so as to effect the actualtransfer of funds to or from the credit card account, conduct ACHsettlement, etc.

According to one embodiment, multiple affiliate banks are provided forconducting settlements, e.g., ACH settlements with other banks, checkcard transactions, transactions with credit card companies, etc.Referring to FIG. 1, for example, one affiliate financial institutionmay be represented as server 50.sub.1, and a second financialinstitution as server 50.sub.2. In this embodiment, a user is preferablygiven an option to choose an affiliate bank to conduct the settlements.For example, the different affiliate financial institutions may offerdifferent fee schedules, award programs, etc. After a user selects anaffiliate financial institution, that institution becomes the defaultuntil changed by the user. In one embodiment, both parties to atransaction (i.e., payor and payee) may identify the same or differentaffiliate financial institutions for conducting settlement for thetransaction. Additionally, different default affiliate banks may beselected by a user depending on the type of settlement. In preferredaspects, database 22 stores the affiliate bank preferences and otheruser preferences in relation to each online account.

According to another embodiment, a transaction limit is placed on anonline account until it has been established that the user is able toreceive mail at a billing address, e.g., for a credit card or ATM checkcard. In this embodiment, the user is limited to sending or receiving nomore than a certain amount, for example, $200, until the user hasverified that they are able to receive U.S. mail at the billing address.When the user signs up or registers with the system, a letter is sent tothe billing address. The letter includes a code, such as an alphanumericcode. After the letter and code have been received, the user canverify/confirm the physical billing address by entering the code whenlogging in to the system. Once the physical address has been confirmed,the transaction limit may be raised. In one embodiment, the transactionlimit is automatically raised, for example, to the lesser of $1000/monthor the credit card limit, if credit card information was entered.Alternatively, the transaction limit may be set by the user, within aspecified maximum set by the system. It will also be appreciated thatany transaction limit determining scheme may be used.

While the invention has been described by way of example and in terms ofthe specific embodiments, it is to be understood that the invention isnot limited to the disclosed embodiments. To the contrary, it isintended to cover various modifications and similar arrangements aswould be apparent to those skilled in the art. Therefore, the scope ofthe appended claims should be accorded the broadest interpretation so asto encompass all such modifications and similar arrangements.

We claim:
 1. A method implemented on at least one computer forestablishing user online accounts in a computer network, the methodcomprising the steps of: receiving registration information from a firstuser for establishing a first online account on the at least onecomputer, the registration information including a physical mailingaddress; receiving credit card account information from the first user;setting a transaction limit on the first online account to a first valuethat comprises a temporary limit pending a verification; providing, tothe first user, a confirmation code to verify that the physical mailingaddress is a valid address; receiving the confirmation code from thefirst user for verification with a processor that the physical mailingaddress is a valid address; and automatically raising the transactionlimit on the first online account to match a credit limit on the creditcard account when the confirmation code is received and verified unlessthe first value is less than the credit limit, in which case thetransaction limit is set at the first value after verification.
 2. Themethod of claim 1, further comprising: linking the first online accountwith the credit card account.
 3. The method of claim 2, furthercomprising: funding the first online account from the credit cardaccount.
 4. The method of claim 2, wherein the funding of the firstonline account comprises a transfer of an amount equal to the temporarylimit.
 5. The method of claim 1, further comprising receiving a transferrequest from the first user, the transfer request including an amount offunds for transfer from the first online account associated with thefirst user and identification information for a recipient of the funds,the identification information including an electronic message addressfor the recipient, wherein the amount of funds is less than or equal tothe transaction limit; automatically sending an electronic message tothe recipient using an electronic message address, the electronicmessage indicating that funds are ready for transfer to the recipient;receiving a response from the recipient accepting or rejecting thetransfer of the funds; and transferring the funds from the first accountto a second online account associated with the recipient when therecipient's response indicates acceptance.
 6. The method of claim 5,wherein the electronic message address includes a user ID associatedwith the recipient, and wherein the step of automatically sending anelectronic message includes initiating an instant message session withthe recipient based on the user ID.
 7. The method of claim 5, whereinthe response includes a request by the recipient to open an account, andwherein the method further includes the step of opening the secondaccount for the recipient.
 8. The method of claim 5, wherein thetransfer request further includes a request for identity confirmation,and wherein the response from the recipient includes identityinformation responsive to the request for identity confirmation, themethod further including the steps of: automatically sending theidentity information to the first user; and receiving from the firstuser an acceptance or a rejection of the identity information; whereinfunds are transferred only if an acceptance is received from the firstuser.
 9. A method implemented on at least one computer for transferringfunds between user online accounts in a computer network, the methodcomprising the steps of: receiving registration information from a firstuser for establishing a first online account on the at least onecomputer, the registration information including a physical mailingaddress; receiving credit card account information from the first userfor a credit card account associated with the first user; providing, tothe first user, a confirmation code to verify that the physical mailingaddress is a valid address; receiving the confirmation code from thefirst user for verification with a processor that the physical mailingaddress is a valid address; and automatically setting the transactionlimit on the first online account to match a credit limit on the creditcard account when the confirmation code is received and verified. 10.The method of claim 9, further comprising: linking the first onlineaccount with the credit card account.
 11. The method of claim 10,further comprising: funding the first online account from the creditcard account.
 12. The method of claim 9, further comprising receiving atransfer request from the first user, the transfer request including anamount of funds for transfer from the first online account associatedwith the first user and identification information for a recipient ofthe funds, the identification information including an electronicmessage address for the recipient, wherein the amount of funds is lessthan or equal to the transaction limit; automatically sending anelectronic message to the recipient using an electronic message address,the electronic message indicating that funds are ready for transfer tothe recipient; receiving a response from the recipient accepting orrejecting the transfer of the funds; and transferring the funds from thefirst account to a second online account associated with the recipientwhen the recipient's response indicates acceptance.
 13. The method ofclaim 12, wherein the electronic message address includes a user IDassociated with the recipient, and wherein the step of automaticallysending an electronic message includes initiating an instant messagesession with the recipient based on the user ID.
 14. The method of claim12, wherein the response includes a request by the recipient to open anaccount, and wherein the method further includes the step of opening thesecond account for the recipient.
 15. The method of claim 12, whereinthe transfer request further includes a request for identityconfirmation, and wherein the response from the recipient includesidentity information responsive to the request for identityconfirmation, the method further including the steps of: automaticallysending the identity information to the first user; and receiving fromthe first user an acceptance or a rejection of the identity information;wherein funds are transferred only if an acceptance is received from thefirst user.
 16. A method implemented on at least one computer oftransferring funds between user online accounts in a computer network,the method comprising the steps of: receiving registration informationfrom a first user for establishing a first online account on the atleast one computer, the registration information including an addressand credit card account information; setting a transaction limit on thefirst online account to a first value that comprises a temporary limitpending a verification; providing, to the first user, a confirmationcode to verify the address; receiving the confirmation code from thefirst user for verification that the address is a valid address;receiving a request, from the first user, to raise the transaction limiton the first online account to a second value that is at or below acredit limit from the credit card account information; and increasing,upon receipt and the verification of the confirmation code, thetransaction limit on the first online account to the second value. 17.The computer implemented method of claim 16 wherein the second value isset by the first user.
 18. The computer implemented method of claim 16wherein the registration information and confirmation code are receivedfrom the first user over the Internet.